Gazprom, Naftogaz Ukrainy resume talks on gas debt

The European Union has expressed concern over the stand-off

OAO Gazprom and NJSC Naftogaz Ukrainy resumed talks in Moscow on a payment dispute that led the Russians to slash natural gas supplies to Ukraine last week, a spokesman for the Ukrainian company said, according to Thompson Financial.

The European Union has expressed concern over the stand-off, which bears some similarities to a 2006 price row that led Russia briefly to cut off gas to Ukraine, disrupting supplies in several European countries.

Europe relies on Russia for around a quarter of its gas supplies, and some 80 pct of those imports come through pipelines that cross Ukraine. There have been calls in EU capitals to reduce Europe`s reliance on Russian gas.

In the current dispute, Russia wants Ukraine to pay back alleged unpaid debts for gas imports in 2008, while Ukraine wants to get rid of an opaque system of intermediaries for gas payments to Russia.

Gazprom reduced gas supplies to Ukraine by 25 pct on March 3 and by an additional 25 percent on March 4 in a bid to pressure Kiev but was forced to back down after Ukraine warned it could divert gas earmarked for Europe.

Gazprom and Naftogaz announced the resumption of supplies on March 5.

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